Section 502 Direct Loan Program

Over 60 years, the Section 502 Direct Loan Program has helped more than 2.1 million families realize the American Dream and build their wealth by more than $40 billion. It is the only federal homeownership program that is exclusively targeted to very low- and low-income rural families. By law, at least 40 percent of Section 502 funds must be used to assist families earning less than 50 percent of the area median income. Three-fourths (74 percent) borrowers have incomes less than 60 percent of AMI, with an average income less than $28,275. With a Section 502 Direct Loan, these families can access affordable, safe mortgages with interest rates starting at just 1 percent over a 38-year term.